American Tire talks $330 million notes: 10 years at 10% area, seven years at Libor plus 525 bps area

By Paul A. Harris

St. Louis, March 16 - American Tire Distributors Inc. issued price talk on its $330 million two-part offering of high-yield notes, according to market sources.

Pricing is expected on Friday.

Price talk on a tranche of seven-year floating-rate notes (CCC+, lowered from B-) is in the area of three-month Libor plus 525 basis points. The notes will be non-callable for two years.

Meanwhile price talk on a $200 million tranche of 10-year senior subordinated notes (CCC+) is in the 10% area. The notes will be non-callable for five years.

Banc of America Securities LLC has the books for the Rule 144A offering. The co-managers will be Credit Suisse First Boston and Wachovia Securities.

Proceeds will be used to finance the sale of American Tire Distributors Inc. to Investcorp.

The prospective issuer is a Charlotte, N.C., independent wholesale tire supplier.

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